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8-K - 2011 1ST QUARTER EARNINGS RELEASE - C. H. ROBINSON WORLDWIDE, INC.rrd309346.htm

 

 

C.H. Robinson Worldwide, Inc.

14701 Charlson Road

Eden Prairie, Minnesota 55347

Chad Lindbloom, senior vice president and chief financial officer (952) 937-7779

Angie Freeman, vice president, investor relations and public affairs (952) 937-7847

FOR IMMEDIATE RELEASE

C.H. ROBINSON REPORTS FIRST QUARTER RESULTS

MINNEAPOLIS, April 26, 2011 - C.H. Robinson Worldwide, Inc. ("C.H. Robinson") (NASDAQ: CHRW), today reported financial results for the quarter ended March 31, 2011.

Summarized financial results for the quarter ended March 31 are as follows (dollars in thousands, except per share data):

Three months ended

March 31,

2011

2010

%

change

Total revenues

$ 2,365,472

$2,074,617

14.0%

Net revenues:

Transportation

Truck

$ 294,500

$ 241,665

21.9%

Intermodal

9,600

8,496

13.0%

Ocean

15,570

12,522

24.3%

Air

9,185

8,835

4.0%

Other Logistics Services

14,065

13,419

4.8%

Total Transportation

342,920

284,937

20.3%

Sourcing

32,999

34,938

-5.5%

Information Services

14,422

12,726

13.3%

Total net revenues

390,341

332,601

17.4%

Operating expenses

233,626

196,594

18.8%

Operating income

156,715

136,007

15.2%

Net income

$ 97,028

$ 84,012

15.5%

Diluted EPS

$ 0.59

$ 0.50

18.0%

 

 

Our truck net revenues, which consist of truckload and less-than-truckload ("LTL") services, increased 21.9 percent in the first quarter of 2011. Our truckload volumes increased approximately 7.5 percent in the first quarter of 2011 compared to the first quarter of 2010. Our truckload net revenue margin was consistent with the first quarter of 2010. Excluding the estimated impacts of the change in fuel, our truckload pricing to our customers increased approximately eight percent in the first quarter of 2011 compared to the first quarter of 2010. Our truckload transportation costs increased approximately six percent, excluding the estimated impacts of the change in fuel. Our LTL net revenues increased approximately 31 percent. The increase was driven by an increase in total shipments of approximately 18 percent, pricing increases, and a small increase in our net revenue margin.

Our intermodal net revenue increased 13.0 percent due to increased prices, partially offset by a small volume decline. Price increases were driven by market conditions and the increased price of fuel. Net revenue margins were slightly higher than the first quarter of 2010.

Our ocean transportation net revenues increased 24.3 percent in the first quarter of 2011, driven by higher pricing and volume increases, partially offset by increased cost of capacity.

Our air transportation net revenue increased 4.0 percent in the first quarter of 2011 due to higher volumes.

Other logistics services net revenues consist primarily of transportation management fees and customs brokerage fees. The increase of 4.8 percent was driven primarily by an increase in management fees.

For the first quarter, our Sourcing revenues decreased 14.8 percent. Sourcing net revenues decreased 5.5 percent to $33.0 million in 2011 from $34.9 million in 2010, primarily due to decreased volumes with a large customer.

Our Information Services revenues increased 13.3 percent in the first quarter of 2011 due to increases in some fees that are impacted by fuel prices and an increase in transactions.

For the first quarter, operating expenses increased 18.8 percent to $233.6 million in 2011 from $196.6 million in 2010. This was due to an increase of 19.3 percent in personnel expense and an increase of 17.4 percent in other selling, general, and administrative expenses. Personnel expenses related to our restricted stock program and various other incentive plans increased compared to last year. Many of these plans are variable based on growth in our earnings. We also increased our average headcount from the first quarter of 2010.

For the first quarter, other selling, general, and administrative expenses increased to $58.5 million from $49.8 million in the first quarter of 2010. As previously announced, we recorded a $5.9 million charge in the first quarter due to a ruling by the Illinois Court of Appeals.

Founded in 1905, C.H. Robinson Worldwide, Inc., is one of the largest non-asset based third party logistics companies in the world. C.H. Robinson is a global provider of multimodal transportation services and logistics solutions, currently serving over 36,000 customers through a network of 232 offices in North America, South America, Europe, Asia, Australia, and the Middle East. C.H. Robinson maintains one of the largest networks of motor carrier capacity in North America and works with over 49,000 transportation providers worldwide.

Except for the historical information contained herein, the matters set forth in this release are forward-looking statements that represent our expectations, beliefs, intentions or strategies concerning future events. These forward-looking statements are subject to certain risks and uncertainties that could cause actual results to differ materially from our historical experience or our present expectations, including, but not limited to such factors as changes in economic conditions such as the strength of the current recovery and uncertain consumer demand; changes in market demand and pressures on the pricing for our services; competition and growth rates within the third party logistics industry; freight levels and increasing costs and availability of truck capacity or alternative means of transporting freight, and changes in relationships with existing truck, rail, ocean and air carriers; changes in our customer base due to possible consolidation among our customers; our ability to integrate the operations of acquired companies with our historic operations successfully; risks associated with litigation and insurance coverage; risks associated with operations outside of the U.S.; risks associated with the potential impacts of changes in government regulations; risks associated with the produce industry, including food safety and contamination issues; fuel prices and availability; and the impact of war on the economy; and other risks and uncertainties detailed in our Annual and Quarterly Reports.

 

Conference Call Information:

C.H. Robinson Worldwide First Quarter 2011 Earnings Conference Call

Tuesday, April 26, 2011 5:00 pm. Eastern Time

Live webcast available through Investor Relations link at www.chrobinson.com

Telephone access: 877-941-8609; conference ID 4432022

Webcast replay available through Investor Relations link at www.chrobinson.com

Telephone audio replay available until 12:59 a.m. Eastern Time on April 29: 800-406-7325;

passcode: 4432022#

 

CONDENSED CONSOLIDATED STATEMENTS OF INCOME

(unaudited, in thousands, except per share data)

Three months ended

March 31,

2011

2010

Revenues:

Transportation

$1,991,022

$ 1,639,236

Sourcing

360,028

422,655

Information Services

14,422

12,726

Total revenues

2,365,472

2,074,617

Costs and expenses:

Purchased transportation and related services

1,648,102

1,354,299

Purchased products sourced for resale

327,029

387,717

Personnel expenses

175,109

146,755

Other selling, general, and administrative expenses

58,517

49,839

Total costs and expenses

2,208,757

1,938,610

Income from operations

156,715

136,007

Investment and other income

225

474

Income before provision for income taxes

156,940

136,481

Provision for income taxes

59,912

52,469

Net income

$ 97,028

$ 84,012

Net income per share (basic)

$ 0.59

$ 0.51

Net income per share (diluted)

$ 0.59

$ 0.50

Weighted average shares outstanding (basic)

165,124

165,440

Weighted average shares outstanding (diluted)

165,764

166,575

 

 

CONDENSED CONSOLIDATED BALANCE SHEETS

(unaudited, in thousands)

March 31,

2011

December 31,

2010

Assets

Current assets:

Cash and cash equivalents

$ 359,335

$ 398,607

Available-for-sale securities

982

9,290

Receivables, net

1,175,775

1,036,070

Other current assets

45,979

37,801

Total current assets

1,582,071

1,481,768

Property and equipment, net

114,779

114,333

Intangible and other assets

399,484

399,598

Total Assets

$ 2,096,334

$ 1,995,699

Liabilities and stockholders' investment

Current liabilities:

Accounts payable and outstanding checks

$ 709,124

$ 627,561

Accrued compensation

49,098

96,991

Other accrued expenses

93,537

47,055

Total current liabilities

851,759

771,607

Long term liabilities

17,049

20,024

Total liabilities

868,808

791,631

Total stockholders' investment

1,227,526

1,204,068

Total liabilities and stockholders' investment

$ 2,096,334

$ 1,995,699

 

 

 

CONDENSED CONSOLIDATED STATEMENT OF CASH FLOWS

(unaudited, in thousands, except operational data)

Three months ended

March 31,

2011

2010

Operating activities:

Net income

$ 97,028

$ 84,012

Stock-based compensation

12,510

4,664

Depreciation and amortization

7,139

7,559

Provision for doubtful accounts

2,397

2,637

Other non-cash expenses, net

(1,822)

3,111

Net changes in operating elements

(64,639)

(98,058)

Net cash provided by operating activities

52,613

3,925

Investing activities:

Purchases of property and equipment

(5,663)

(2,893)

Purchases and development of software

(3,967)

(1,475)

Purchases of available-for-sale securities

-

(8,541)

Sales/maturities of available-for-sale securities

8,327

6,481

Other

18

(25)

Net cash used for investing activities

(1,285)

(6,453)

Financing activities:

Payment of contingent purchase price

(3,850)

-

Net repurchases of common stock

(44,286)

(62,847)

Excess tax benefit on stock-based compensation

7,511

2,391

Cash dividends

(48,851)

(42,409)

Net cash used for financing activities

(89,476)

(102,865)

Effect of exchange rates on cash

(1,124)

(2,270)

Net change in cash and cash equivalents

(39,272)

(107,663)

Cash and cash equivalents, beginning of period

398,607

337,308

Cash and cash equivalents, end of period

$ 359,335

$ 229,645

As of March 31,

2011

2010

Operational Data:

Employees

7,783

7,350

Branches

232

235

 

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